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Happiness and economics: insights for policy from the new 'science' of well-being

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  • Carol Graham

    (The Brookings Institution, USA
    University of Maryland College Park, USA)

Abstract

Behavioral economists' revival of homo-sapiens now includes the study of happiness. The analysis is based on surveys of the subjective well-being of myriad individuals within and across countries. It is a tool for better understanding human well-being, and for answering questions that revealed preference based approaches cannot answer, including the welfare effects of institutional arrangements individuals cannot change; of choices that are the result of addiction and self-control problems; and of situations in which they do not have agency. This paper reviews the methods; key research questions, including the causal properties of well-being; and potential policy applications.

Suggested Citation

  • Carol Graham, 2017. "Happiness and economics: insights for policy from the new 'science' of well-being," Journal of Behavioral Economics for Policy, Society for the Advancement of Behavioral Economics (SABE), vol. 1(1), pages 69-72, February.
    • Handle: RePEc:beh:jbepv1:v:1:y:2017:i:1:p:69-72
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    References listed on IDEAS

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    1. Blanchflower, David G. & Oswald, Andrew J., 2004. "Well-being over time in Britain and the USA," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1359-1386, July.
    2. Bruno S. Frey & Alois Stutzer, 2002. "What Can Economists Learn from Happiness Research?," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 402-435, June.
    3. De Neve, Jan-Emmanuel & Oswald, Andrew J., 2012. "Estimating the influence of life satisfaction and positive affect on later income using sibling fixed-effects," LSE Research Online Documents on Economics 51523, London School of Economics and Political Science, LSE Library.
    4. C. Graham & S. Pettinato, 2002. "Frustrated Achievers: Winners, Losers and Subjective Well-Being in New Market Economies," Journal of Development Studies, Taylor & Francis Journals, vol. 38(4), pages 100-140.
    5. Oswald, Andrew J. & Wu, Stephen, 2010. "Objective Confirmation of Subjective Measures of Human Well-being: Evidence from the USA," IZA Discussion Papers 4695, Institute of Labor Economics (IZA).
    6. Carol Graham, 2011. "Adaptation amidst Prosperity and Adversity: Insights from Happiness Studies from around the World," The World Bank Research Observer, World Bank, vol. 26(1), pages 105-137, February.
    7. Dolan, Paul & Kavetsos, Georgios & Tsuchiya, Aki, 2013. "Sick but satisfied: The impact of life and health satisfaction on choice between health scenarios," Journal of Health Economics, Elsevier, vol. 32(4), pages 708-714.
    8. Carol Graham & Lucas Higuera & Eduardo Lora, 2011. "Which health conditions cause the most unhappiness?," Health Economics, John Wiley & Sons, Ltd., vol. 20(12), pages 1431-1447, December.
    9. Graham, Carol & Eggers, Andrew & Sukhtankar, Sandip, 2004. "Does happiness pay?: An exploration based on panel data from Russia," Journal of Economic Behavior & Organization, Elsevier, vol. 55(3), pages 319-342, November.
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    Cited by:

    1. Marijana Andrijic, 2022. "Economics And Happiness €“ Key Insights And Latest Findings," Economic Thought and Practice, Department of Economics and Business, University of Dubrovnik, vol. 31(1), pages 257-275, june.
    2. Frey, Bruno S., 2017. "Research on Well-Being: Determinants, Effects, and its Relevance for Management," Die Unternehmung - Swiss Journal of Business Research and Practice, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 71(4), pages 358-367.

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    More about this item

    Keywords

    well-being; happiness; well-beings surveys; public policy;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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